Last updated on Dec 10 , 2019



Reports and Publications

Our current publications can be accessed at

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Research Methodology

At Next Capital our strong research function is the back-bone through which we help clients make better informed investment decisions and improve portfolio returns.

The core belief in value investing is the driving force of our research team which is setting new standards of quality in Pakistan’s equity research. Our flagship publication is the Investment Outlook, which combines analysis with strategy to guide equity investors in Pakistan. Because of our unwavering commitment to quality, we do not publish daily research reports. The truly great investment opportunities are rare and our research team focuses on bringing clients these outstanding investment opportunities in a timely manner. To ensure the highest quality, our research follows a systematic methodology in developing our investment ideas.

  • Gather data from annual reports and industry reports
  • Gain perspective by speaking with company management, competitors, industry experts, and market participants
  • Useful for idea generation
  • Industry analysis of competition, demand, and pricing
  • Determine company position within industry
  • Determine management track record
  • Identify profitability drivers
  • Develop valuation assumptions
  • Forecast P&L, Balance Sheet and Cash Flows
  • Determine Fair Value using appropriate valuation methodology
  • Peer and regional valuations are also considered
  • Assign star ranking based on upside potential
  • Star ranking will range from 5 star to 1 star based on their upside potential
  • 5 star stocks offer the highest upside potential, 1 star stocks offer the least upside potential
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Star Ranking

Next Capital has pioneered a star ranking methodology in equity research in Pakistan. Rankings range from a maximum of 5 star to a minimum of 1 star, based upon the upside potential that a stock offers. Ranking changes can occur due to price movement, or a change in the target price.

5 star

4 star

3 star

2 star

1 star

Target price offers > 25 % upside

Target price offers > 15 % and < 25 % upside

Target price offers > 0 % and <15 % upside

Target price offers > 0 % and < 15 % downside

Target price offers > 15 % downside

The primary advantage of the star ranking is that it allows our clients to ascertain our batting average in equity research. Often, sell side research analysts trumpet their successful ideas, and fail to mention their failures. Using the star rankings, our research team will be held accountable for all calls made, good and bad. With ranking updates provided on a regular basis, our clients will have an objective framework through which they can determine the calls we got right, and how many we didn’t. An added advantage of the star rankings is that a change in ranking due to a significant move in price (without any change in the underlying fundamentals), will help our clients make considered buy and sell decisions.

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Research Products

Our research team offers a few different types of products. More details on each of these products can be accessed here

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